Producing and using energy isn’t a simple process. For instance, magic doesn’t charge your phone whenever you plug it into an outlet. There are lots of actions that take place to generate the electricity needed to charge your phone. When thinking about how we make and use energy, policymakers must weigh the costs and benefits across three key criteria:
- Reliability
- Affordability
- Sustainability
Electricity, for example, needs to stay on and always be available. The price needs to fit household budgets. And we want the source of that electricity to have minimal environmental impacts and climate effects. As some push to “electrify everything,” it’s important to understand the tradeoffs, especially across these criteria.
“Electrify everything” advocates heavily emphasize sustainability. The hope is that America can reduce its greenhouse gas emissions by eventually making the vast majority of our electricity from renewable sources. That could happen, but right now, Energy Information Administration (EIA) data shows that 21.4% of electricity generation comes from renewables. It is going to take a lot of time and investment to go from 21.4% to something close to 100%.
Sustainability is one of the three criteria we need to consider. Another is affordability. Some claim American families could save as much as $2,500 per year if we pursue electrification policies. But an October report from the U.S. Department of Energy (DOE) casts doubt on that claim. Even with our current electricity generation mix (natural gas, nuclear, coal, renewables, and hydro), DOE data shows that electricity costs consumers 3.5 times more than natural gas, challenging the idea that electrifying everything will reduce energy costs. According to the report, electricity costs around $47 per million Btu (MMBtu) in 2024, while natural gas costs just $13 per MMBtu.
Another government agency — the EIA — issues an annual assessment of how much people will have to pay to heat their homes in the ensuing winter. EIA’s “Winter Fuels Outlook 2024-25” report found that families relying on electricity will pay 75% more to heat their homes this winter than those using natural gas.
There are appliances that only use electricity. I haven’t seen a natural gas-powered television. Let me know if there is one out there, though! But, for those appliances that can be powered by natural gas, why electrify everything? This tactic would increase energy costs for most Americans and could force impossibly difficult family budget decisions, especially during winter, such as choosing between warmth and adequate food or medicine.
What about reliability? Electrification has its challenges. The first is simple — intermittent, renewable energy sources, such as wind and solar aren’t available 24 hours a day.
The second reliability issue is one we’ve previously discussed: America’s electric grid isn’t close to big enough to deliver all the extra power we’ll need. Our current grid is straining to meet the current demand, and experts forecast a dramatic demand increase from data centers used to power artificial intelligence over the next few years. Shifting all energy demand, including shifting residential heat from natural gas to the electric grid would require a massive expansion — and then might impact reliability. The reality is that relying on any one energy source, such as electricity, increases the likelihood that some of us could lose power, especially when demand is highest or when there are extreme weather events.
The solution? An “all of the above” strategy that includes renewables, traditional energy sources such as natural gas, as well as other technologies like nuclear, geothermal, and hydro. And who knows, other technologies may emerge in the future. I wholly support innovation!
We must invest now in our energy infrastructure to meet future demand. That includes the electricity grid, which must be larger and more resilient to meet future demands that only electricity can meet. That also means more pipelines to move natural gas and natural gas liquids from the point of production to their end use. America has abundant energy resources. Let’s leverage our country’s competitive advantage to provide consumers affordable, reliable, and cleaner natural gas and its associated products such as propane.
Policymakers should evaluate energy comprehensively through the three criteria — reliability, affordability, and sustainability, ensuring energy sources are selected based on what Americans value most.
Stuart Saulters is Vice President, Federal Affairs, for GPA Midstream. In that role, he leads the trade association’s effort to engage policymakers on Capitol Hill and within the President’s administration.
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